Minister wants to stop patient rip-offs

Mia Malan speaks to the health minister and others in the healthcare sector about the guideline tariffs.

Government:Health Minister Aaron Motsoaledi
"I can't be expected to be neutral in the pricing of healthcare. Every health minister in the world will demand that healthcare is affordable. However, I did not tell the Health Professions Council of South Africa to introduce low tariffs in order to make doctors affordable to the National Health Insurance (NHI) scheme.

"But the NHI is coming for sure – within the next five years. Doctors who out-price themselves won't be part of it. I don't know what they will be part of. Private healthcare in South Africa is extraordinarily expensive.

Tariffs won't be introduced with the intention of making it impossible for doctors to make a living. But ripping off people is not the only way to make a decent living.

"I did not tell the council what tariffs to introduce. It is merely trying to fill a vacuum: without tariffs, there is chaos; it's the law of the jungle. How can the council calculate whether a doctor or dentist has overcharged someone without having a benchmark tariff? The council is trying to fill a vacuum and the tariffs it wants to introduce are an interim measure, until I've managed to sort out things with the Competition Commission so that we are able to sit around a table with doctors and negotiate prices."

Human rights organisation:Section 27
In its submission about tariffs to the council, the human rights organisation Section27 raises concerns about the applicability of using the 2006 national reference price list as a "ceiling" or "ethical" tariff. It argues that the price list represents "average" rather than "maximum" costs in 2006 and that the council should find a more scientific and accurate basis to calculate tariffs.

"The core concern is that if the price-list is not set at a realistic level and doctors can opt out provided that they have informed consent from the patient, there will be no downward pricing pressure. It will simply become the norm for doctors to ignore the tariff schedule and routinely get patients to sign informed consent forms," says senior researcher, Sha'ista Goga. "Also, this tariff does not set boundaries for when a fee is ethical and when it can be classified as overcharging. This makes assessing complaints of overcharging very difficult and is unfair to providers and patients."

Medical organisations:The dental association and the Private Practitioners Forum
Medical organisations are sceptical about the council's public participation process.

"We are watching the process with a hawk's eye and are highly suspicious of it," said Maretha Smit of the South African Dental Association. "We strongly suspect there is an already written document with tariffs lying on someone's desk that will be accepted, regardless of our input."

Neil Kirby, of law firm Werksmans Attorneys, which represents the Private Practitioners Forum and the association, said: "If people are ignored, the [tariff] list will end up in the courts [again]."

Medical schemes: Discovery Health
Will Discovery gravitate towards the council guideline tariffs? That is, if the tariffs turn out to be vastly lower, would Discovery adjust its fees accordingly?

According to Jonathan Broomberg, chief executive of Discovery Health, the medical scheme developed its tariff schedules on the principles of balancing adequate remuneration with the skills and experience of doctors, and ensuring the long-term affordability and sustainability of medical schemes.

"Discovery Health tariffs are currently about 50% above the historic ‘medical scheme rates' and about 90% of all specialist and general practitioner consultations for Discovery members occur with doctors who are contracted with medical schemes managed by Discovery Health at these tariffs. Discovery would not reduce its doctor tariffs if recommended tariffs by the council come out lower, because this would undermine the principles of adequate remuneration for doctors," said Broomberg.

"It is critical that both tariffs and coding schemes are continuously evaluated and updated. This is a highly technical process and no statutory body currently has the expertise to conduct this process. In our view, the only feasible mechanism is a structured, bilateral negotiation process in which doctors and healthcare funders can work together in a structured manner to reach agreement each year. Within this framework, the health department could play a critical role, setting the rules for the structured negotiation process and intervening in situations where no agreement is reached."

Setting fee rules has been an intricate process

South Africa does not have guideline tariffs for medical treatment because of a complex series of events, mostly to do with court action resulting from a lack of ­consultation with medical professionals in determining the tariffs.

Before 2004, according to the Health Professions Council, tariffs were determined by medical aids, doctors and dentists. In 2004, the Competition Commission ruled that the setting of negotiated fees was anti-competitive.

In 2006, the Council for Medical Schemes published a national health reference price list, which was used to determine reasonable medical aid reimbursement rates. The council adopted three times the medical aid rate as its ceiling or ethical tariff – a cut-off fee that was used to decide whether a practitioner had overcharged.

However, the South African Dental Association's chief executive, Maretha Smit, said the council also used what she dubs ­"professional rates", which were calculated by the South African Medical and Dental Association until 2006 to determine whether an unethical fee had been charged. Adjusted, inflation-related sets of the professional ­tariffs were published annually until 2006. These tariffs were higher than the medical aid rates and, according to the dental association, were based on the actual costs of procedures and labour.

In 2008, the council scrapped its ethical tariffs because the health department decided to create its own price list, which the council was expected to use.

In 2010, the North Gauteng High Court declared the department's price list invalid after medical associations took it to court and accused it of "lack of consultation".

In August last year, the council attempted to publish new guideline tariffs in the Government Gazette but backtracked on its decision after doctors' and dentists' associations threatened it with court action for not consulting them. They argued that the council did not have a mandate to calculate the fees in the first place. The process has been opened to public submissions until February 21.